Canara Bank Student Loans for Study Abroad: Complete Guide

While foreign universities can provide valuable education, they can also come with high tuition and living expenses. To make the payment for a foreign education easier, many Indian banks, including Canara Bank, offer education loans to eligible Indian students.

Read on to learn more about education loans available from Canara Bank, how much they cost, and what you need to know before you apply.

Canara Bank Study Abroad Loan Schemes

Canara Bank in India offers two kinds of education loans for Indian students looking to go abroad for higher education:

Education loan scheme for pursuing master's degree abroad from select top-ranking universities of the world

This scheme is available for Indian students who are accepted for a master's degree in a STEM program at select high-ranking universities abroad.¹

Loan Amount Available

Under this scheme, the minimum loan amount is INR 7.50 lakh. There is no ceiling on the maximum amount as long as the applicant is able to provide a collateral security that is 100% of the loan amount or above. For collateral coverage less than 100%, the maximum loan available is INR 100 lakh.

Collateral Security

Collateral valued at a minimum of 50% of the loan amount is required to apply under this scheme. This requirement can be supported by the assignment of the applicant's income from future employment after graduation.

Loan Processing charges

• The processing charge is 0.5% of the sanctioned loan amount. But if you provide 100% of the collateral security, your maximum charge is INR 10,000
• If the collateral security is less than 100%, the maximum charge is INR 20,000.

Margin Payment

The borrower must be able to provide 10% of the loan amount to apply for the education loan under this scheme.

Interest Rates

Canara Bank Study Abroad Loan interest rates are linked to the bank's Repo-Linked Lending Rate (RLLR). As of May 5, 2023, the RLLR of Canara Bank is 9.25%.²

Added to the RLLR is a credit risk premium percentage credit risk premium which depends on how much collateral, or security, you put down for the loan.

Rates retrieved on May 22, 2023. Please verify the latest rates from the Canara Bank website.

So if you provide more collateral, your effective interest rate will be less.

The IBA Model Education Loan Scheme:

This scheme offers need-based finance for Indian students seeking a graduate or postgraduate degree abroad (and in India as well). It requires collateral security based on the size of the loan. Loans for higher studies abroad that are more than INR 7.50 lakhs must be secured by 100% collateral.²

Margin Payment:

Under the IBA Model Scheme, there is no margin requirement for loans of up to INR 4 lakhs. For a loan amount above INR 4 lakhs, a margin payment of 15% of the loan is required.

Interest Rates

For the IBA Model Education Loan Scheme, the interest rate you will pay is linked to the loan amount. Loans for higher studies abroad that are more than INR 7.50 lakhs must be secured by 100% collateral.

Rates retrieved on May 22, 2023. Please verify the latest rates from the Canara Bank website.

Canara Bank Study Abroad Loan Repayments Terms

Typically you won't have to start repaying your loan until after the moratorium period, which is your course period plus a maximum of one year. After that, you will need to start making payments towards your loan. The maximum repayment period is 15 years for both loan schemes.¹

How to apply for the Canara Bank Study Abroad Loan

Once you have received admission, ensure all the required documents are ready when submitting an application for the Canara Bank Study Loan Abroad.

Documents required for Canara Bank Study Abroad Loan

Here are the documents needed when applying for a Canara Bank Study Abroad Loan:

• New customers must complete the KYC formalities and open a Canara Bank savings account before applying for a Canara Bank Study Loan Abroad. Existing Canara Bank account holders will not need to go through the KYC process.

• Besides the KYC documents like address and identity proof, the student borrower must submit their educational credentials from Standard X onwards. It includes mark sheets, degrees, certificates, and any relevant diplomas.

• The admission letter detailing the admission confirmation to the respective university abroad and the course details and fee structure. This letter should also include the disbursement schedule.

• Details of the collateral security.

• Financial credentials of parents or guardians, as required.

Canara Bank holds the right to ask for additional documents as needed.

Applying Online through the Vidya Lakshmi portal

1. Start the online application through the Vidya Lakshmi portal⁴
2. Fill up the single application form and select Canara Bank as the financial partner.
3. Complete the necessary details.
4. Submit the supporting documents.

Canara Bank Study Abroad Loan - Apply in person.

Students can also visit the nearest Canara Bank branch and complete the education loan application with the branch's Credit Manager. You can contact your nearest Canara Bank branch.⁵

Canara Bank Study Abroad Loan Disbursal Process

Once your loan is approved, an important part is receiving the loan funds. Canara Bank follows a specified loan disbursal process for its education loan schemes:

• The loan money for tuition is sent annually to the university abroad where you are enrolled. As a borrower, you must provide the bank with the disbursement schedule ahead of time.

• If you need to be reimbursed, you must provide the original tuition or other expense receipts, and the bank will reimburse the amount to your bank account.

• The living expenses for the Canara Bank Study Abroad Loan are credited to the student's bank account. The bank offers a travel card that can be refilled with foreign currency that students can use.

Save with international remittance when you choose Wise

It can be hard to manage all the things you need to do before leaving India to study. Make international payments easier with Wise, which uses smart tech to make money transfers from India safe, secure - and cheap.

Wise can help you save⁷ when sending money to bank accounts abroad. You can save money on international transfers with Wise's low transfer fee and the mid-market exchange rate, which is the same as the one you see on Google. So make university payments or living expenses a breeze when you use Wise to send money abroad from India.

And once you arrive abroad for your studies, check out the Wise multi-currency account available for residents living in supported countries. Enjoy an account as worldly as you are and spend just like a local when you travel abroad with a linked debit card, while also paying less in fees.

Please see the Terms and Conditions for your region and visit our pricing page for the most up-to-date pricing and fee information on Wise products.